5 Crypto Tips for Beginners
admin,June 21, 2018
If you are visiting this article, you may already be interested in investing in cryptocurrencies. These immutable and exchangeable cryptographic cryptocurrencies promise to become a non-manipulatable money for the world. Their advocates see a future in which cryptocurrencies will substitute fiat money and create the first free and hard world currency. However, this kind of investment is high-risk. The volatility grossly exceeds that of any other investment class. There is the risk that cryptocurrencies get outlawed, that exchanges get hacked or that you lose your cryptocurrency key.
This article is meant as a guide to help you.
Understand the Tech
The first thing to do before investing in cryptocurrencies is to ensure you understand the technology (Blockchain). You can read articles, check online forums, and also watch vlogs that discuss cryptos. This will help you to see the possibilities of the potential of the blockchain.
Invest only what you can afford to lose
Risk is equal to Reward. This relationship means investments that are risky will tend to potentially give you higher returns. It is in accordance with the market today which is much more volatile than traditional markets (where 20%-50% swings in a day is commonplace), but it’s also much more unpredictable. This makes crypto markets intensely risky and that is why in the crypto market you have the potential to make loads of money or lose everything instantly. So it is best to have the mindset that the money you put in today could very well be worthless tomorrow or the next day, in other words, don’t invest more than you can afford to lose.
Focus on the long-term
It’s tempting to buy in and catch the wave when a coin is surging in price or making a bull run. But remember, short-term trading in this extremely volatile market could be disastrous. Therefore you should always be focused on the long-term because rushing in to buy a trade, as most likely, by the time you buy in, the price will start to correct and you may be stuck with a loss. There is hodl which was originally a typo but now has become a meme and a general trading strategy that means to hold long term. Simply hold onto your investments throughout the highs and the lows, and avoid day trading. As the markets grow over time, so will your investments, so don’t get greedy and try to make multiples of your investments too quickly. Furthermore, focusing on the long run is also fruitful as the technology that sustains cryptocurrencies is still in its infancy and it will take a while before the technologies and various innovations within the cryptocurrency ecosystem are ready for mainstream adoption.
The ultimate cryptocurrency investment strategy is to invest in a portfolio of varied and exciting coins and picking them up when they are new to the scene and still relatively cheap. The best cryptocurrency exchanges only list a limited selection of cryptocurrencies but there are over 1600 different coins and tokens out there. If you want to make money it makes sense to be in several exchanges so that you can pick up coins when they are still cheap before they become popular – remember to choose carefully, you need to look for valuable coin and not the scam ones.
For beginners is easier to use a beginner friendly exchange, because the blockchain technology requires a certain amount of IT affinity to understand. The complexity of the crypto market can make beginners lose their initial enthusiasm with trading. Therefore if you choose a platform that is specially designed for those who have just started to get to know the crypto market and trading, you can enjoy the benefits of trading even if you are new to the market.
Always be keen to research while keeping an eye on your profit and loss
The main key to profitability in this area is to buy low and then sell high. You need to pay attention while placing a buy order, as well as observe when the market moves in a bullish direction to count your gains. Observe and do your research as since the crypto market is currently unregulated, there are a lot of scam projects or simply money-grabs out there.